This is an email from Gary Keller addressing the Florida market, however we can easily substitute the Phoenix Real Estate market because it is vary applicable to all of us.
From: Gary Keller
Sent: Sat 8/18/2007 10:47 AM
Subject: RE: The Florida Market
1. when local markets shift they shift fast. real fast. and if you’ve never experienced it - faster than you thought it could.
2. usually too fast for almost any agent to be completely prepared the moment the phones stop ringing. it’s just immediate.
3. only the ones who are deep into prospecting lead generation, database relationship lead generating and had some talent with them are even remotely ready to deal with the shift.
4. a 50 percent drop in a market in one year is extreme beyond much historical precedence. that is a massive drop - just as the rise up was too!
5. clearly the public is slow to get this so there are still too many people getting into real estate while not enough getting out. 12.5% drop in agent base isn’t enough and is a true challenge at the present. you’re dealing with an imbalance right now. it will correct but the length of time is unpredictable.
6. we did a study of the top 500 agents in our company and here is what we found. 300 have seen their business go back and 200 have seen their business go forward. of the 200 around 30% are in markets that haven’t really gone backwards very much. so 140 or so agents out of 500 are in tough markets and doing better. we then started interviewing these agents to see what they were doing, which will all be part of the foundation of our discussions at mega camp and masterminds this year.
and here is what we discovered. the ones who are doing better:
1. responded quickly, swiftly and without hesitation. they got what was going on and acted. NO HESITATION.
2. they cut expenses and dead weight as far as they could. anything not bolted down got cut(except education) and anyone not ready to work got cut.
3. they focused on direct contact lead generation activities - calling people, going to see them, open house, etc….. they went and found people to talk to.
4. they saw each lead as precious and made sure they were capturing the calls/leads and setting appointments. they quit delegating this in many cases.
5. they focused on price reductions (either at the listing table up front or weekly/monthly after that or both). they had to get the prices right.
6. they focused on staging and presenting the houses they had listed better than the competition. they realized there is still competition for houses in certain price ranges and certain markets and they took their battle to those areas.
7. they created clear feedback loops to their sellers and buyers so they know what is going on at all times.
8. they prepared their staffs for the long haul ahead - better attitude, better skills and better scripts. they got deep into educating themselves and team.
In the short-term, until the market weeds out more people you will have a very very tough time. but not an impossible one. someone will make money in the market - it just has to be you and your people.
I love your attitude and fight. i’ve been here before and it will take all of that and then some to pull through this. however, pull through it and in a few years you could just be making more money than you thought possible. that is how it has worked out for so many in the past - not everyone - just those who were acknowedged the market, stayed positive and did the right things quickly and stayed on them.
hope this thinking helps.
onward….gk
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